Category: UNCATEGORIZED

Deep Render, a London startup and spin-out of Imperial College that is applying machine learning to image compression, has raised £1.6 million in seed funding. Leading the round is Pentech, with participation from Speedinvest.

Founded in mid-2017 by Arsalan Zafar and Chri Besenbruch, who met while studying Computer Science at Imperial College London, Deep Render wants to help solve the data consumption problem that is seeing internet connections choke, especially during peak periods exacerbated by the current lockdown happening in many countries.

Specifically, the startup is taking what it claims is an entirely new approach to image compression, noting that image and video data comprises more than 80% of internet traffic, driven by video-on-demand and live streaming.

“Our ‘Biological Compression’ technology rebuilds media compression from scratch by using the advances of the machine learning revolution and by mimicking the neural processes of the human eye,” explains Deep Render co-founder and CEO Chri Besenbruch.

“Our secret sauce, so to speak, is in the way the data is compressed and sent across the network. The traditional technology relies on various modules each connected to each other – but which don’t actually ‘talk’ to each other. An image is optimised for module one before moving to module two, and it’s then optimised for module two and so on. This not only causes delays, it can cause losses in data which can ultimately reduce the quality and accuracy of the resulting image. Plus, if one stage of optimisation doesn’t work, the other modules don’t know about it so can’t correct any mistakes”.

Deep Render team

To remedy this, Besenbruch says Deep Render’s image compression technology replaces all of these individual components with one very large component that talks across its entire domain. This means that each step of compression logic is connected to the others in what’s known as an “end-to-end” training method.

“What’s more, Deep Render trains its machine learning platform with the end goal in mind,” adds Besenbruch. “This has the benefit of both boosting the efficiency and accuracy of the linear functions and extending the software’s capability to model and perform non-linear functions. Think of it as a line and curve. An image, by its nature, has a lot of curvature from changes in tone, light, brightness and colour. By expanding the compression software’s ability to consider each of these curves means it’s also able to tell which images are more visually pleasing. As humans, we do this intuitively. We know when colour is a little off, or the landscape doesn’t look quite right. We don’t even realise we do this most of the time, but it plays a major role in how we assess images and videos”.

As a proof-of-concept, Deep Render carried out a fairly large-scale Amazon MTurk study, comprising of 5,000 participants, to test its image compression algorithm against BPG (a market standard for image compression, and part of the video compression standard H.265). When asked to compare perceptual quality over the CLIC-Vision dataset, over 95% of participants rated its images more visually pleasing, with Deep Render images being just half the file size.

“Our technological breakthrough represents the foundation for a new class of compression methods,” claims the Deep Render co-founder.

Asked to name direct competitors, Besenbruch says a past-competitor was Magic Pony, the image compression company bought by Twitter for a reported $150 million a year after being founded.

“Magic Pony was also looking at deep learning for solving the challenges of image and video compression,” he explains. “However, Magic Pony looked at improving the traditional compression pipeline via post and pre-processing steps using AI, and thus was ultimately still limited by its restrictions. Deep Render does not want to ‘improve’ the traditional compression pipeline; we are out to destroy it and rebuild it from its ashes”.

To that, Besenbruch says currently the only similar competitors to Deep Render are WaveOne based in Silicon Valley, and TuCodec based in Shanghai. “Deep Render is the European answer to the war about the future of compression technology. All three companies incorporated roughly at the same time,” he adds.

Countingup, the business current account that “automates” your accounting, has raised £4 million in self-described bridge funding. Leading the round is ING Ventures, with co-investment from Triple Point, CVentures, and BiG Start Ventures.

Founded by Tim Fouracre, who previously founded cloud accounting software Clear Books, and now boasting 20,000 business customers, Countingup’s long term vision is to be the one “financial hub” for the 1 million or so U.K.-based micro businesses.

Its initial ‘attack vector’ is to combine a business bank account with bookkeeping features to help automate the filing of accounts — a major time sink and pain-point for sole traders and small businesses.

Small businesses can open a Countingup business current account on their smartphone “in under 5 minutes,” which includes typical banking and accounting features. In addition, Countingup recently launched its “Accountant Hub,” a web-based accounting system that helps accountants manage and collaborate with their SME clients.

“If you are running a business then bookkeeping is a chore, wastes your time and is boring,” the Countingup up founder told me back in 2017. “Your bank surprises you with hidden fees and you’ve probably lost faith in their customer service. Countingup is making starting and running a business really simple… We’re doing that by combining accounting and banking into one simple smartphone app”.

In addition, Fouracre reckons Countingup’s solution will become even more relevant once HMRC’s Making Tax Digital (MTD) initiative kicks in. In future, the U.K. tax authority will require businesses to keep digital records and submit quarterly tax filings, which is exactly the type of task the fintech has been designed to automate.

“The [new] funds will be used to accelerate the banking and accounting roadmap to make it even easier and more efficient to digitally run a small business,” says Countingup, announcing its bridge round.

Queue statement from Benoît Legrand, ING’s Chief Innovation Officer and CEO of ING Ventures: “Countingup is a game-changer for small businesses. This fintech helps in reducing costs and complexity by combining accounting and banking into one digitally disruptive solution, a new approach that makes it so much easier to run a small business. We are proud to support Countingup in delivering that vision.”

Despite the worldwide impact of the COVID-19 pandemic, global smartwatch shipments continued to grow during the first three months of the year, driven by online sales, says a new report by research firm Strategy Analytics.

Shipments grew 20% annually to reach 13.7 million units in the first quarter of 2020, up from 11.4 million units in the previous quarter. Apple Watch stayed in the top position, with 55% global market share, followed in second place by Samsung. Garmin rose to third place.

“Smartwatches are selling well through online retail channels, while many consumers have been using smartwatches to monitor their health and fitness during virus lockdown,” wrote Strategy Analytics senior analyst Steven Waltzer.

In the first quarter of 2020, 7.6 million Apple Watches shipped, a 23% increase from the 6.2 million shipped during the same period one year ago. Apple Watch’s market share grew from 54% to 55%.

Samsung shipped 1.9 million smartwatches, compared to 1.7 million last year, while its market share went down from 15% to 14%. Waltzer writes that Samsung’s smartwatch growth was slowed by the coronavirus lockdown in South Korea and new competition from rivals like Garmin .

Garmin took the number three position for the first time in two years, shipping 1.1 million smartwatches in the first quarter, a 38% increase from 800,000 a year ago. This grew Garmin’s share of the global smartwatch market from 7% to 8%, thanks to new models like the Venu with OLED color touchscreen.

Strategy Analytics expects global smartwatch shipments to slow in the second quarter of 2020 because of the pandemic, but recover during the second half of the year, as stores reopen and some consumers turn to smartwatches to help them monitor their health.

“Smartwatches continue to have excellent long-term prospects, as younger and older people will become more health-conscious in a post-virus world,” wrote analyst Woody Oh. “Smartwatches can monitor vital health signs, such as oxygen levels, and consumers may find comfort in having a virtual health assistant strapped to their wrist.”

Nigerian startup Helium Health sits in a good position during a difficult period, according to its co-founder.

The Lagos based healthtech venture is in the black, has batted away acquisition offers, and just raised a $10 million Series A round, CEO Adegoke Olubusi told TechCrunch.

The startup offers a product suit that digitizes data, formalizes monetization and enables telemedicine for health care systems in Nigeria, Liberia, and Ghana.

Helium plans to use the latest funding round to hire and expand to North and East Africa, including Kenya, Rwanda, Uganda and Morocco, Olubusi confirmed on a call.

He co-founded the startup in 2016 — with Dimeji Sofowora and Tito Ovia — to bring better delivery of medical services in Nigeria and broader Africa.

“It’s really about tackling three core problems that we see in the healthcare sector in Africa: inefficiency, fragmentation and a lack of data,” said Olubusi.

When he and co-founders Sofowora and Oviato set out doing research for Helium, they noted a data desert on medical info across the continent’s healthcare infrastructure.

“We figured out very quickly that that is a long term problem to solve. And the best way to get the data and access to it is to give simple technology to the providers and let them use it to make their lives more efficient.”

Helium Health has since developed several core product areas for healthcare entities with application for providers, payment, patients, and partners.

It offers tech solutions and developer resources for administration, medical records and financial management. Helium Health has digital payment and credit products for hospitals and insurance providers.

As part of the latest financing, the startup is launching several new products — such as the MyHelium Patient app to facilitate appointments and information sharing between healthcare providers and citizens.

Images Credits: Helium Health

Helium also accelerated deployment of a telemedicine platform in response to the coronavirus hitting Nigeria and the lockdowns that ensued.

“In the last three weeks since we launched we’ve had roughly 360 hospitals sign up, and they’ve had thousands of [online] visits already,” Olubusi said.

Helium Health generates revenues by charging percentages and fees on its products, services and accompanying transactions. Current clients include several hospitals in the West Africa region, such as Paelon Memorial in Lagos.

Helium Health’s model got the attention of the startup’s $10 million Series A backers and Silicon Valley accelerator Y-Combinator — which accepted the startup into its spring 2017 batch.

Global Ventures and Africa Healthcare Masterfund co-led the investment with participation that included Tencent and additional Y-Combinator support.

Global Ventures General Partner Noor Sweid confirmed the Dubai based fund’s co-lead of the round and that the firm will take a Helium Health board seat.

The path of the startup’s CEO —  Adegoke Olubusi — to tech founder passed through the U.S. and traditional corporate roles. He went to Maryland in 2014 to complete an advanced degree in engineering at Johns Hopkins University, then did a stint at Goldman Sachs before landing positions in big tech with eBay and PayPal.

Olubusi found work with big corporates less than stimulating and gravitated to forming his own company and returning to Nigeria.

“When I was at eBay and Goldman I was really bored and I wanted to do something more challenging,” he said. “We thought, ‘why don’t we pick a problem that is a long-term problem in Africa,'” Olubusi explained.

Helium Health founders (L to R) Dimeji Sofowora, Tito Ovia, and Adegoke Olubusi: Image Credits: Helium Health

The founder believes the products Helium Health creates can improve the poor health care stats in countries such as Nigeria — which stands as Africa’s largest economy and most populous nation.

Nigeria also ranked 142nd out of 195 countries on health performance indicators in The Lancet’s 2018 Healthcare Access and Quality Index.

On the dismal stats, “We need more properly run hospitals, and we need more profitable hospitals, health systems and health care providers,” said Olubusi.

Better monetization and organization of hospitals could lure more doctors back to African countries, he believes.

“Half my family are doctors but none of them practice in Nigeria. Everyone’s practicing all over the place, but Nigeria,” Olubusi said.

The founder also sees a more digitized and data driven health care sector as something that can draw more entrepreneurs to African healthtech. Compared to dominant sectors, such as fintech, health related startups in Africa gain a small percentage of the continent’s annual VC haul — only 9.3% by Partech’s 2019 stats.

“There are people who want to invest in the market but they can’t…and founders can’t really tackle a healthcare problem because they don’t know what’s going on,” he said.

As for his venture, Olubusi expects growth even given the precarious economic outlook COVID-19 is creating for countries, such as Nigeria — which is expected to enter recession this year.

The coronavirus and lockdowns are shining a light on the country’s healthcare inadequacies (according to Helium Health’s CEO) that people can’t ignore, including the elite.

“This is the first time they can’t get on their jet and leave so they have to go to the hospitals we have. The system was neglected for the last few decades because people had that [previous] option,” said Olubusi.

“I’m hoping this coronavirus crisis will be a period that forces everyone to rethink what we’re doing [on healthcare].”

That could lead to more business for Helium Health.

The startup doesn’t release financial information but has positive net income. “We do generate revenues in millions of dollars and are profitable,” Olubusi said.

Helium Health has received acquisition offers, but declined them, according to its CEO. Olubusi and team intend to grow the venture to the point where it can list on a major global exchange.

“We know this is the kind of business we can take public, without having to sell,” he said.

Sinclair Broadcast Group has agreed to pay a $48 million fine to the Federal Communications Communication to close investigations related to its attempted merger with Tribune Media. The FCC said in its announcement that this is the largest civil penalty paid by a broadcaster in the agency’s history. It added that Sinclair will also have to “abide by a strict compliance plan in order to close three open investigations.”

The merger, which was valued at $3.9 billion and would have created one of the largest broadcasters in the United States, was called off by Tribune in August 2018. Tribune also filed a lawsuit accusing Sinclair of breaching contract and misleading regulators “in a misguided and ultimately unsuccessful attempt to retain control over stations that it was obligated to sell.”

In today’s announcement, the FCC said its agreement with Sinclair was related to investigations into the company’s disclosure of information related to the acquisition of Tribune-owned stations, its failure to identify sponsored content it produced for broadcast, and “whether the company has met its obligations to negotiate retransmission consent agreements in good faith.”

In today’s FCC statement, chairman Ajit Pai, who was critical of the deal before it was scrapped, said “Sinclair’s conduct during its attempt to merge with Tribune was completely unacceptable. Today’s penalty, along with the failure of the Sinclair/Tribune transaction, should serve as a cautionary tale to other licensees seeking Commission approval of a transaction in the future.”

He also added that the FCC would not revoke licenses granted to the conservative-leaning broadcaster. “On the other hand, I disagree with those who, for transparently political reasons, demand we revoke Sinclair’s licenses,” Pai said. “While they don’t like what they perceive to be the broadcaster’s viewpoints, the First Amendment still applies around here.”

In a statement, Sinclair Broadcast Group president and CEO Chris Ripley said that the company is “pleased with the resolution announced today by the FCC and to be moving forward. We thank the FCC staff for their diligence in reaching this resolution. Sinclair is committed to continue to interact constructively with all of its regulators to ensure full compliance with applicable laws, rules and regulations.”

Some of you may recall the South Korean app Zepeto that went viral among Gen Z users a year and a half ago. The app, which renders selfies into animated avatars and lets people adorn their computer-generated manifestations with virtual items, appears to have sustained its relevance. It has amassed 150 million registered users, the company told TechCrunch recently, although its number of monthly active users, which is a better metric to gauge an app’s performance, hovers around 10 million.

China is by far the largest market for Zepeto, locally known as Zaizai (崽崽), an affectionate nickname for children. “Zaizai aspires to develop into a comprehensive ecosystem while also offering robust content across China,” affirmed CEO Daewook Kim.

The app could benefit from its pedigreed background. It’s developed by the selfie app Snow, of which parent company Naver also owns the Asian messaging giant Line.

It’s not uncommon for a popular photo-editing tool to fade out as people move onto the next trending alternative, either because the new player arrives with more impressive visual capabilities or its marketing stunt creates a spell on many — or both. As such, apps that are disposable and serve utility purposes often have to think hard about retaining their users or engage aggressively to monetize them while the going is still good.

Zepeto did both.

Screenshot: a user shares videos of herself dancing and her Zepeto character dancing on Douyin

The app includes a social networking function where users can interact anonymously through their avatars in virtual spaces akin to The Sims. The challenge with that, of course, is building a big enough network that lures people to keep returning.

Zepeto also comprises of a series of mini games that are evocative of what Lee described as peaceful exploration people are enjoying in red-hot Animal Crossing.

In other words, the business is ripe for selling virtual items. Indeed, the leader in this category of business, Tencent, once generated the bulk of its income from the items it sold to decorate users’ virtual profiles and spaces, a business modeled on the South Korean internet pioneer Cyworld. That was before Tencent earned a wider global reputation by building WeChat and operating blockbuster video games.

Zepeto has so far generated some $10 million from 600 million pieces of virtual items sold. It stepped up the effort recently by launching a creative marketplace where third-party artists can offer their virtual lines of clothes and accessories. Called Zepeto Studio, the store clocked around $700,000 in sales in its first month. Many add-ons are branded — a common strategy for photo-enhancement apps — so you can sport things like virtual Nike apparel.

“We’ve partnered with global brands like Disney and Nike, as well as celebrities like BTS. We hope to continue to bring exciting partnerships to Zaizai Studio as well as better service to our creators,” said Rudy Lee, head of Zepeto’s global business, adding that the Studio feature for China is scheduled to launch mid-May.

Branded Nike apparel on Zepeto

If enough people keep using Zepeto, the third-party store can be a lucrative pursuit for designers. Among Zepeto’s 60,000 registered artists, the highest-paid creator pocketed some $9,000 in sales in the first month.

But as numbers grow, Zepeto is also getting cautious about keeping its marketplace civil. The firm maintains an internal moderation team that weeds out “political messaging, hate speech, or discriminatory messaging on the virtual clothes,” said Lee. The rule is particularly pertinent to its development in China where the flow of information is strictly controlled.

Another way to survive as a utility tool is to piggyback off another app’s success. We have written about the way PicsArt, a photo-editing app that rivals VSCO, managed to stay in the game by supporting TikTok-inspired stickers. Zepeto has taken notice. Many of its users are now sharing their animated avatars on Douyin, the Chinese edition of TikTok, observed Lee.

A glimpse at Lyft’s stock price Wednesday, which soared as much as 16.77% after first-quarter earnings were reported, suggested all was well in the ride-hailing company’s world.

In this COVID 19-era, “well” is a relative term. Lyft’s net losses did dramatically improve from the year-ago quarter (a loss of $398 million versus $1.1 billion in Q1 2019). However, Lyft was clear in its earnings call: COVID-19 had a profound impact on its customers and its business and the future was uncertain.

“It is impossible to accurately predict the duration and depth of the economic downturn we face,” Lyft CFO Brian Roberts said during an earnings call Wednesday afternoon. “Our business may be impacted for an extended period of time. So we must be prepared to adapt accordingly.”

The difficulty of predicting what will happen has hamstrung thousands of companies trying to navigate the COVID-19 pandemic. Last month, Lyft withdrew its previously provided revenue and adjusted EBITDA guidance for full year 2020 because of the vast unknowns.

“Given this fluidity, it is impossible for us to predict with any certainty our results,” Roberts said. After the requisite warnings, Roberts did eventually provide an outlook for the second quarter — and it isn’t pretty. The outlook focused on adjusted EBITDA, which doesn’t give the most complete financial picture. It provides enough to understand that even with considerable cost-cutting measures, Lyft will suffer losses nearly four times wider than the first quarter.

Roberts said Lyft can manage to keep its second quarter adjusted EBITDA loss under $360 million if rides on its rideshare platform remain at April levels — which were down 75% year-over-year — for the remainder of the quarter. Lyft reported Wednesday an adjusted EBITDA loss of $85.2 million in the first quarter.

There are some early signs of a recovery. Ridership in the week ended May 3 was up 21% from the lows experienced in mid-April, according to Lyft. However, Lyft can’t afford to simply hope rideshare will return. It has to — and already has — enact a plan that will allow it to navigate the pandemic and come out as a survivor. In other words, Lyft will be judged at how well can stem the losses and find new revenue streams.

Work to cut costs has already started.

The company put together an aggressive plan to strengthen its financial position, Lyft co-founder and CEO Logan Green said during the earnings call. Lyft reduced its more than 5,000-person workforce by 17% and furloughed nearly another 300. Lyft also initiated a three-month pay reduction for all salaried employees, ranging from 10% for its most non-hourly team members, up to 30% for its senior leadership team and board members.

“Every other expense line is being scrutinized and no stone will be left unturned,” Green said.

The company expects to be able to cut its annualized fixed costs by $300 million by the end of the year. The reductions are based on its original expectations for 2020. Lyft has also ended rider coupons once ridership began to decline in mid-March and paused adding new drivers in nearly all markets.

“This reduces costs we incur associated with onboarding new drivers and helps protect utilization and earnings opportunities for existing drivers during this time of lower ride demand,” Green said.

Lyft reduced its 2020 capital expenditure plan by $250 million. And its sought out cost savings on the insurance front. (The company’s primary auto insurance policies expire at the end of September; Roberts said they’re considering the best options to reduce future volatility, as well as lower overall costs.)

The company is also shifting attention and resources to projects that executives believe will improve its unit economics. Finding those revenue streams will be tricky. Lyft has already provided a few clues of where it’s headed.

The company will continue with its Essential Deliveries pilot that launched April 15. The initiative lets government agencies, local non-profits, businesses and healthcare organizations request on-demand delivery of meals, groceries, life-sustaining medical supplies, hygiene products and home necessities.

Green said the company will evaluate any future opportunities based on how it performs. But he quickly added “that we have no interest in launching a consumer food delivery service. And so, we will not be doing that.”

Green also seemed cautiously optimistic about a new lost cost product called “Wait and Save,” that allows Lyft optimize the marketplace and be more efficient with matching drivers and riders.

A number of popular apps including Spotify, Tinder, Pinterest and TikTok were fielding user iOS crash reports Wednesday evening, the result of an apparent issues with Facebook’s SDK according to a lengthy GitHub thread on the topic.

Downdetector logged tens of thousands of user crash reports on Spotify between 3:30 and 5:30 pm PT, the time where the bulk of reports seem to have been issued across a number of popular apps. User crash reports appeared to be dying down as of publication time.

Users had reported that their apps were shutting down immediately after launch.

For plenty of users, this will likely be news to them that many of their favorite apps are immediately connecting to Facebook servers at launch. Developers at tech companies rely on Facebook’s SDK for advertising insights in additions to the company’s login portal. Users impacted by the issue didn’t have to be utilizing Facebook login for the issue to affect them.

We’re reached out to Facebook for comment on the issue and will update with details.

When I first met Bustle Digital Group’s Jason Wagenheim, it was right as New York City was beginning to go into lockdown. The BDG offices were empty thanks to the company’s newly instituted work-from-home policy, but it still seemed reasonable to meet in-person to learn more about BDG’s broader vision.

At the time, Wagenheim — a former Fusion and Condé Nast executive who joined BDG as chief revenue officer before becoming president in February — acknowledged that we were entering a period of uncertainty, but he sounded a note of cautious optimism for the year ahead.

Since then, of course, things have been pretty rough for the digital media industry (along with the rest of the world), with a rapid reduction in ad spending leading to layoffs, furloughs and pay cuts. BDG (which owns properties like Elite Daily, Input, Inverse, Nylon and Bustle itself) had to make its share of cuts, laying off two dozen employees, including the entire staff of The Outline.

And indeed, when I checked back in with Wagenheim, he told me that he’s anticipating a 35% decline in ad revenue for this quarter. And where he’d once hoped BDG would reach $120 or $125 million in ad revenue this year, he’s now trying to figure out “what does our company look like at $75 or $90 million?”

At the same time, he insisted that executives were determined not to completely dismantle the businesses they’d built, and to be prepared whenever advertising does come back.

We also discussed how Wagenheim handled the layoffs, how the company is reinventing its events sponsorship business and the trends he’s seeing in the ad spending that remains. You can read an edited and condensed version of our conversation below.

TechCrunch: We should probably just start with the elephant in the room, which is that you guys had to make some cuts recently. You were hardly the only ones, but do you want to talk about the thought process behind them?

Jason Wagenheim: Yeah, we ended up having to say goodbye to about 7% of our team, and we had salary reductions to the tune of 18% company-wide for those that made over $70,000. And then we had 30% pay cuts for executives.

You’ve read about all this, I’m sure. It was a really, really hard decision. We spent two weeks in planning, dozens of spreadsheets, negotiating with our investors on a plan that would keep the company moving forward, but [had to] be very sober to the reality of what was happening around us. But also most importantly for us, for our executive team, we weren’t about to disassemble the company that we spent the last 12 to 18 months building.

Despite the global panic caused by the current pandemic, startups in Latin America have continued to attract international capital. In April, Mexico’s Alphacredit, Colombia’s Frubana and Brazil’s CargoX were among those that raised particularly large rounds to support their growth during this challenging time. All three companies target markets that may have grown since the start of the pandemic, namely lending, food delivery and cargo delivery, respectively.

Alphacredit, a Mexican lending startup, raised a $100 million equity round from SoftBank and previous investors to continue to expand its digital banking services across Mexico. This round comes just months after the startup received a $125 million Series B round from SoftBank in January of this year. Alphacredit’s CEO explained that the round would enable the company to help clients during the current liquidity crisis, increasing financial inclusion in Mexico.

Meanwhile, fresh produce delivery platform Frubana raised a $25 million Series A led by GGV and Monashees, with support from SoftBank, Tiger Global and several other private investors. The startup delivers fresh produce to restaurants and small retailers directly from farmers across Colombia, and participated in Y Combinator in 2019.

Frubana has seen a boom in demand for its products since the start of the COVID-19 pandemic. People have shied away from visiting large grocery stores, preferring to visit local mom-and-pop shops that receive the startup’s deliveries. Frubana raised $12 million in mid-2019 to help scale into Mexico and Brazil after it hit a monthly growth rate of 50% in the Colombian market. The startup’s founder, Fabián Gomez, started Frubana after serving as head of Expansion at Rappi, one of Latin America’s fastest-growing startups and Colombia’s first unicorn.

Finally, Brazil’s “Uber for Trucks,” CargoX raised an $80 million Series E round led by LGT Lightstone Latin America, with contributions from Valor Capital, Goldman Sachs and Farallon Capital. The startup has quietly grown to become one of the largest players in Brazil’s inefficient trucking industry, managing a fleet of nearly 400,000 truck drivers, without owning a single truck.

This investment brings CargoX’s total capital raised to $176 million and has enabled the company to launch a $5.6 million fund for the delivery of essential goods in Brazil during COVID-19. This fund will help CargoX keep drivers employed and ensure the proper delivery of essential goods like medication, food and cleaning products.

Nubank launches $3.8 million COVID-19 fund to support clients

Brazil’s largest neobank, Nubank, announced a $3.8 million (R$20 million) fund to help its clients survive the current pandemic. The fund also relies on partnerships with iFood, Rappi, Hospital Sírio-Libanês and Zenklub to help struggling clients access food, supplies, medical care and online psychological treatment throughout the pandemic.

Nubank will use the fund to grant credits to people who cannot leave their home, providing them with discounted groceries and free delivery service. Through the partnership with Hospital Sírio-Libanês, the neobank will pay for more than 1,000 free online consultations with doctors for its home-bound clients.

Nubank has more than 20 million clients across Brazil and Mexico, where it launched in 2019. CEO David Velez stated that he believed the fund could serve tens of thousands of people in need by the end of April. Customers who wished to receive these benefits were directed to reach out to Nubank via phone, email or chat to be connected with a representative who could grant the appropriate credits.

iFood merges with Domicilios to fight Rappi in its home territory

Brazil’s largest food deliverer, iFood, recently announced a partnership with Delivery Hero to merge with their Colombian subsidiary, Domicilios. The parties did not disclose the price of the deal but have shared that iFood is now the majority shareholder in Domicilios, holding 51% of the company.

IFood operates in Mexico and Colombia, as well as Brazil, but has struggled to gain traction in Spanish-speaking Latin America. This merger makes iFood geographically the largest food delivery company in the country, with more than 12,000 restaurants in its network. However, local last-mile delivery startup Rappi continues to dominate the market, using SoftBank backing to blitzscale across the region.

By comparison, iFood has focused on developing its technology, using artificial intelligence to improve the user experience across its platforms in Mexico, Colombia and Brazil. Using these systems, iFood processes more than 26 million deliveries each month, helping restaurants across the region adapt to the new protocols caused by the virus and social-distancing policies. IFood hopes the merger will help provide a more competitive delivery service for Colombians, as well as helping boost growth for local restaurants.

News and Notes: Nuvocargo, Kueski, Magma Partners, SouSmile

Freight-forwarding startup Nuvocargo raised $5.3 million in seed funding to support the growth of its trade routes across the U.S.-Mexico border. Founded by Ecuadorian-born Deepak Chhugani in 2018, Nuvocargo has grown quickly since participating in Y Combinator, although this funding was their first institutional round. The round drew investors from both sides of the border, including Mexico’s ALLVP. Nuvocargo also marks the first investment by new partner Antonia Rojas Eing. Nuvocargo is working hard to ensure its truck drivers are safe as they continue to deliver essential supplies across the border through the pandemic.

Mexican online credit platform Kueski announced that it would lay off employees due to the economic crunch caused by COVID-19. Kueski provides microloans to more than 500,000 Mexicans and has been struggling financially as business slows during the pandemic. While Kueski did not disclose an official number, it is estimated that they laid off around 90 employees.

Latin American venture capital firm Magma Partners acquired Guadalajara-based accelerator Rampa Ventures to intensify its investments in Mexico. Rampa’s headquarters will serve as a Mexican base for Magma Partners as it continues to invest in the country, where it already has 12 startups in its portfolio. As a part of the deal, Rampa’s founder Mak Gutierrez will take over as CEO of Magma Partners’ internal agency, Magma Infrastructure, which helps startups grow and market themselves in the region.

The Brazilian direct to consumer dental tech startup SouSmile raised a $10 million Series A this month, closing the deal before investors began to show concerns about COVID-19. SouSmile uses 3D scanners to rapidly create invisible alignment devices for customers to provide them with affordable orthodontics for 60% cheaper than current models. This model has proved highly successful in Latin America, where access to orthodontics is quite low and cost-prohibitive.

Despite an impending global economic crisis, startup investment in Latin America showed signs of resilience in April. Startups in industries like delivery, healthcare and essential services have seen growth this month, and many are providing support to their customers and suppliers in this challenging time.

It is hard to predict what the world will look like for startups, let alone for anyone, by the end of next month. The resilience of Latin America’s startups provides hope that some businesses will bounce back and continue to support their customers throughout the global recovery from this pandemic.